The Best Time to Start Social Security

     I'm of an age where I am just becoming eligible to take Social Security. Hence, when to start my Social Security retirement benefit is a subject near and dear to my heart. There are roughly 15 million Baby Boomers in the 62-66 age bracket who currently face the same question. Another 60 million Baby Boomers are following close on our heels, wondering -- should I wait, or should I get it while I can?

     I did a post on the subject, Should You Take Social Security Early? back in December. Basically, for those of us born between 1943 and 1954, our full retirement age is 66. We are eligible to start payments as early as age 62. But there's a penalty. If you start at age 62, your monthly payments will be about 25 percent lower than if you wait until 66. Conversely, if you can delay Social Security until you're 70, you'll enjoy payments 25 percent higher than what you would have gotten if you started at age 66 -- and 75 percent higher than what you would have received at age 62!

     As an example, if you have a consistent work record and made a decent salary, at age 62 you might expect to receive a Social Security benefit of $1500 a month. If you do nothing else except wait until age 70, you'll collect over $2600 a month. You get fewer checks -- because you're not being paid for those eight years -- but it would seem that if you can make it to age 70, you'd be better off in your final years.

     But results, as they say, vary. So every year the government sends an update to you called "Your Social Security Statement," which details your own prospective benefit under various circumstances.

     It seems simple, doesn't it?  But life is complicated. Not all companies keep employees around until they're 66, so a lot of people in their late 50s and early 60s lose their jobs. (Age discrimination? I'm shocked! Shocked!) They might need the money now, and don't have the luxury of devising a strategy to maximize benefits over their lifetime. Also, not everyone works for money. If you rely on a spouse for benefits, things can get complicated, especially if you're divorced.

     Then, remember, Social Security is a government program, so it is ridiculously complicated. Your benefit depends on how long you have worked, how much money you earned, whether you're single, married or divorced, and it seems a hundred other variables. Plus, if as a beneficiary you make over a certain amount of money, your payment will be taxed -- are you surprised that the government gives with one hand, but takes with another?

     The bottom line is:  figuring out how to maximize your payments is virtually impossible. However, you can make some educated guesses. There's an article on yahoo! finance, by Linda Stern of Reuters, that tries to help you puzzle out what's best for you. She consults a couple of experts who analyze the situation. And, of course, they disagree. One argues it's better to start benefits early. The other says you're better off to delay.

     But there are a few rules of thumb:

     Take Social Security early if:

     1) Your income is low and you really need the money now.

     2)  You have a spouse who will be eligible for a larger benefit later on.

     3) You have good reason to believe you will not live into your 80s -- either because you're suffering from a life-shortening disease, or you figure your genes are just not going to get you that far. (I've seen a corollary point of view suggesting that men take Social Security early, and women wait, simply because women tend to live longer than men.)
 
     Delay if:

     1)  You're still working.

     2)  You're healthy, and have a family history of extended longevity.

     3)  You have a large nest egg ... at least $500,000.

     But wait! What if the government changes the rules? A lot of people worry that Congress will soon slash Social Security to help shore up the federal deficit. "Don't let 'the Social Security program going to disappear soon so I should take my benefits ASAP' argument sway you," says Linda Stern. "Even the most hawkish anti-entitlement politicos aren't talking about taking benefits off the table for anyone within 10 years of retirement."

     If the answer is still not clear for you -- as it won't be for most of us -- then take a look at this free retirement planner that will help you figure out your own situation. (Scroll down and click on "Link to Should You Start Social Security Early.") You can plug in your own numbers, and the calculator will give you some details.

     If it helps alleviate anyone's worries, I ran the numbers for myself and found that all my anxieties are for naught. In the long run, at least for me, it doesn't really matter much when I start taking Social Security. No matter what I do, I will have enough money to keep food on the table, and a roof over my head. But it doesn't look as though I'll be planning any grand tours to Europe in this lifetime.
  

Wine Flows, the Beer Is Flat

     There's dizzying news in the wine industry. For the first time ever in the history of mankind, wine sales in the United States are higher than they are in France.

What Baby Boomers want

      In 2010 sales of wine in the U. S. bubbled up a little more than 2 percent, to 330 million cases. In France, sales were 321 million cases. Of course, there are a lot more people in the Unites States, so French wine consumption drowns American consumption on a per capita basis. The average French person gulps 12.2 gallons of wine a year, compared to an American average of 2.6 gallons a year.

     American wine consumption has been increasing for decades. When I graduated from high school in the 1960s, Americans quaffed 200 million gallons of wine. Sales went up and up, until for some reason they took a dip in the early 1990s. Then they resumed their climb, and last year American vintners poured out some 770 million gallons of vino.

     Approximately one third of Americans drink wine on a regular or semi-regular basis. The core consumer group is affluent Baby Boomers. According to one study on winebusiness.com, almost 90 percent of wine drinkers are homeowners. More than half are two-earner couples, boasting household incomes over $100,000. Almost half of wine drinkers have graduated from college.

     Women, more than men, choose wine as their preferred alcoholic drink. Some 55 percent of women in the 50 to 64 age group choose wine as their favorite alcoholic drink. The figure rises to 63 percent for women 65 and older.

     Less than 20 percent of men say wine tops their list of alcoholic drinks. "Apart from the cultural issues (i.e., beer and football, beer and 'getting together with the guys'), the way we market wine makes many men feel insecure," sniffs one report, saying the wine industry intimidates male customers. Wine is caught up in status, and apparently a lot of men don't think they know enough about wine to order it in a social occasion. They fear they'll make the "wrong" choice, so they tend to turn to a brand name of liquor or else a premium grade of beer.

     One reason for the increasing popularity of wine is that Americans are paying more attention to food, and that has brought greater interest in what gets poured into their glass. "We’re becoming a nation that enjoys food culture,” says Stephanie Gallo, vice president of marketing for the California-based Gallo wine company. "As people embrace cooking and enjoy delicious meals, wine is a natural beverage that accompanies those meals.”

A drink for young males

     It also seems that wine, more than beer, is resistant to recession. While wine sales increased in 2010, the sale of suds had a sobering year, down by 3 million barrels, from 183 million to 180 million. The most popular beers like Bud Lite and Miller fizzled by more than 5 percent. Only 4 of the top 30 brands increased sales for 2010.

     Why are beer sales down while wine sales are up? One headache for beer is the recession, which has hit young males -- the prime beer drinking group -- harder than other groups. Meanwhile, established middle-class wine drinkers, especially those with two incomes, are more likely to have made it through the recession without a financial hangover.

     But it could be that Americans are simply becoming a more sophisticated, upscale bunch. Fewer people work traditional blue-collar jobs and identify with the beer-drinking working class. Americans also crave innovation. There's nothing innovative about Budweiser, which might explain why those beers that are increasing sales are the microbreweries like Boston Beer, or else the cheapest beers like PBR (and if you don't know what PBR stands for, ask a 20-something).

     Just so you don't think we're a nation of boozers, I should assure you that neither wine nor beer is the most popular drink sold in America. That category goes to soft drinks. Followed by bottled water, then coffee, then beer, followed in turn by milk and fruit drinks.

     But if you want to be classy, if you want your neighbors to think you have a college degree and make over $100,000 a year, then wine is your choice of beverage.

And They Thought I Was an Old Joke!

     If you have kids, you know they take some kind of perverted pleasure in letting you know in no uncertain terms that you're square, you're out of it, you're about the lamest excuse for a human being that ever lived.

     Honestly, I remember when I was a teenager and in my 20s, I pretty much thought the same thing about my parents. The difference is:  I was right -- my parents were pretty lame. But my kids are all wrong -- their parents are pretty cool.

     I've pointed out this discrepancy to my kids several times -- about how my parents were square as a checkerboard, but even though they don't always appreciate it, their parents are pretty cool. They know I'm saying this kind of tongue-in-cheek, that I'm trying to be humorous, but they're not buying it. And they typically convey their sentiment with a few eye rolls, a big sigh or two, and then some kind of snicker. They just want to make it clear -- they're laughing at me, not with me.

     Well, I know an old joke when I see it. And it's not me. I ran across a couple of articles recently reporting on the discovery of the world's oldest joke. (Apparently there was a study done a couple of years ago in England, and it's just now being reported in the U.S.) Anyway, hold on to your horses ... the world's oldest joke is a Sumerian fart joke, dating to approximately 2000 BC. I'm not going to tell the joke here, because it's kind of tasteless and not particularly funny.

     Is it any surprise that the oldest humor leans toward the crude side? Here are a couple of examples. The first one comes from Egypt, dating back to circa 1600 BC:  "How do you entertain a bored pharaoh? You sail a boatload of young women dressed only in fishing nets down the Nile and urge the pharaoh to go catch a fish."

     Then there's the old British joke, popular in the 10th century: "What hangs at a man's thigh and wants to poke the hole that it's often poked before? Answer: A key."

     How about one from the Roman Empire: "Augustus was touring his Empire and noticed a man in the crowd who bore a striking resemblance to himself. Intrigued he asked: 'Was your mother at one time in service at the Palace?' 'No your Highness,' he replied, 'but my father was.'" 

     If you really want to read the Sumerian fart joke, or some other ancient thigh-slappers, go to England's Daily Mail online. And taste thee of a boisterous and jesting gamenian.

Are Gas Prices Really That High?

     Who's concerned about the price of gasoline? I sure am. It cost me $55 to fill up my tank the other day, with medium grade gas at $3.99 a gallon.

     I've often thought -- usually late at night, sometimes after I've had a glass of wine -- that gasoline prices should actually be higher, that the state and federal governments should increase gasoline taxes to foster conservation.

     I'm usually on the side that says we should not raise taxes, because those of us in the middle class (not people making over 250K per year) get taxed too much. I work for myself and have to pay 15 percent of my earnings right off the top for Social Security. Then there are federal, state, local, real estate, sales ... well, you know the lineup.

     But let's face it, if gas was more expensive, we might buy cars with better gas mileage; we might live closer to work; we might car pool or take the train to work. We might think twice before driving 20 miles to go to the mall, or just to meet someone for lunch. We might convert trucks to use natural gas.

     Of course, then in the light of day I have to fill up my gas tank, and I go, "Fifty five dollars. Yikes! What's the world coming to?!??"

     Still, it might be worth it to keep ourselves out of trouble in the Middle East. So we don't have to send soldiers to die in Kuwait, Iraq, Afghanistan and now Libya.

     I did a little research. The average price right now for a gallon of regular unleaded gas in the U.S. is $3.81. Of course, it varies from place to place. It's more than that in New York, where I live. It's less in New Jersey, because New Jersey has lower gas taxes.

     But first thing to realize is that, adjusted for inflation, gas is not much more expensive than it was when we were kids in the 1960s. It's gone up a little more than inflation; but less than housing costs or medical costs or college tuition costs. The other issue is that almost everyone else in the world pays more than we do for gas. As you can see from this first list, Europeans pay more than double what we pay. And they have fewer soldiers fighting and dying in Iraq and Afghanistan.

                                 Country                    Price/gal. of gas 

           Spain ............................. $7.50
           United Kingdom............ $8.00
           Denmark ....................... $8.70
           Italy ............................... $8.75
           Germany ....................... $8.80
           The Netherlands ............ $9.65
   
     How about elsewhere in the Americas? All these countries produce a lot of oil. But with the exception of heavily-subsidized Venezuela, nobody gets a bargain on gas prices.

     Venezuela .................... $0.10
     Mexico ......................... $2.70
     Brazil ........................... $5.80
     Canada ......................... $6.90 

  
     There is one region of the world where gas is cheap, even cheaper than in the U.S., and that's the Middle East. Except for Turkey and Israel, where there's little or no oil.

            Saudi Arabia .............. $0.65   
            Kuwait ....................... $0.85
            Iraq ............................ $1.50
            Israel .......................... $7.50
            Turkey ........................ $9.70

      We could easily slap another dollar of tax onto a gallon of gasoline, and we'd still be better off than the Europeans and most of the rest of the world. Then maybe we'd have fewer soldiers fighting for oil wells in the Middle East. We might reduce carbon emissions. And maybe our local governments would have some extra money to fix all those potholes!
.

The Most Popular Song at the Dance

     B and I went to a dance last night. We do a little ballroom dancing now and then. Some Swing and Foxtrot. Cha cha and Salsa. We're not particularly good at it, but we have fun and meet a lot of nice people.

     There's a whole subculture of ballroom dancing, populated mostly by an older crowd. At every dance there's a small group of  real good dancers.  The women show up in backless dresses and skirts that twirl around; the men wear suspenders and dancing shoes. You can tell, they've been doin' it for 50 years.

     Most of the other couples -- well, they look like they're trying real hard. Clearly, the women have dragged their spouses into the program. And the women look pretty good, turning and dipping and twisting. But the men are slow and awkward. They clomp around the dance floor like Frankenstein trying to escape from his Transylvanian castle. (Count me among this crowd.) But, you know, the guys are all smiling and laughing, having a good time. And so are their dancing partners -- a lot of them wives, but a number of girlfriends and a few singles as well.

     There's also a "younger set". The freshmen. The greenhorns. The newbies. These are the people in their early 50s.

     We meet in church basements, the back rooms of restaurants; in the summer we go outdoors on the terrace. Last weekend there was a big dance at a ballroom in Manhattan. A few of the more sophisticated dancers from our group boarded a train and went in for that one. We didn't make it.

     One fellow at last night's dance celebrated his birthday. He was turning 98 years old. Not kidding. And he was out there cutting the rug with the best of them. So there's your prescription for staying young and healthy, fit and happy.

     This is last night's most requested song. Now get up and dance!